THE PRESIDENT: I want to thank the
families for being my guests here at the White House. I'm
honored to host the Peterson family, the Claytor family and the Gordon
family, to talk about the economic challenges they
face. Their circumstances are different, but I strongly
believe they deserve to keep more of their own money -- so does every
family in America deserve to keep their own money.

And we're talking to these families here, I
think they like the idea. Despite the prosperity of the past two
decades, many American families feel squeezed. They
sometimes carry a lot of consumer debt. In 1998, the average
family credit card debt was more than $4,000. At the same
time, every American family is facing higher energy costs.

Under the plan I'll be sending to Congress
later this week, every American who pays income taxes will get tax
relief. And the average relief for a family of four with two
children will be $1,600. This is real and practical and
helpful, when at this time many Americans need it. Sixteen
hundred dollars will pay the average mortgage for a
month. Sixteen hundred dollars will pay for a year's tuition
at a community college. Sixteen hundred dollars will pay the
average gasoline costs for two cars for a year. And $1,600
will buy the average California family 24 months' worth of electric
power.

My plan addresses the struggles of American
families and respects their judgment. It doesn't tell
families how to spend their money; it doesn't single out some Americans
for relief, while leaving others out. It's tax relief for everybody
who pays taxes. That's what the times and basic fairness
demand.

Here's how it will work. Under the
existing law, Americans are grouped in five income tax
brackets: 15 percent, 28 percent, 31 percent, 36 percent and
nearly 40 percent. My plan would reduce to that to four
lower brackets: 10 percent, 15 percent, 25 percent and 33
percent. In other words, we'd begin the simplification of
the code.

Each of the families with me today would
benefit from these lower taxes. Most families will get a
$1,000 per child tax credit. Everybody who pays income
taxes will get some relief. But the biggest percentage cuts
will go to the families who need it most.

The Peterson family, for example, will get 100
percent cut in their income taxes, saving almost $1,100 a
year. Paul and Debbie and their two beautiful girls would
appreciate that. All of the income tax rates should be
cut. Most families over a lifetime will move through a
couple of different tax brackets. Many families will move
through all four as they move up the ladder of economic success, and
then back down as they retire and leave the work force.

Our tax code should not punish success at any
stage of life. The top federal income tax rate at almost 40
percent, and the state income taxes on top of that, people can
sometimes feel like the junior partner in their own
lives. That's why we set the top rate at 33
percent. I believe it's an important principle that no
American should pay more than a third of his or her income to the
federal government in federal taxes.

And government shouldn't block the way into
the middle class for hard working people who are trying to get
there. The single mother earning $25,000 a year manages to
earn $1,000 by getting a promotion -- the federal government takes
about half of it away from her. That's a higher marginal tax
rate than a lawyer earning $250,000. That's not right; and
that's wrong. And my plan addresses this inequity.

This is my approach: tax relief for
everybody, in every bracket, averaging $1,600 per family, while still
reducing our national debt and funding important priorities.

I'm asking all Americans to examine this plan
and I'm asking for your support. The Constitution charges
the Congress with the responsibility to write our tax
laws. And I respect that responsibility. But it
is my obligation to lead, and that's what I'm going to
do. My plan is good for the long-term health of our
economy. It is good for the businesses that create
jobs. It is good for America and for the American families
that make our country so unique and strong.

Thank you for coming.

Q Mr. President, do you
think the tax cut should be retroactive to the first of the year.

THE PRESIDENT: A lot of members of
Congress have talked to me about that. And I
do. And we look forward to working with Congress to expedite
money into the pockets of the American people. I strongly
believe that a tax relief plan is an important part of helping our
country's economy recover. And I think expediting money into
peoples' pockets is going to be a key ingredient. I look
froward to working with Congress, members of both parties, to
accommodate the budgetary needs and, at the same time, help get money
into peoples' pockets quicker.

Q Mr. President,
Democrats in Congress think that this plan, as it's structured now, is
weighted too heavily to the higher income brackets. Are you willing to
work with them to perhaps change the ratios a little bit, if that's
what it takes to get their support?

THE PRESIDENT: I believe the plan,
strongly believe the plan that I have submitted is structured the right
way. I've heard all the talk about class warfare and this
only benefitting the rich. I think when people take a good,
hard look at the rate reduction and who benefits and the fact that our
plan erases inequities in the tax code, or eases inequities in the tax
code; and that the biggest -- the bottom end of the economic ladder
receives the biggest percentage cuts, people will come to realize it.

I think it's important to cut all tax rates,
yes.

Q Mr. President, in
addition to making the tax cut retroactive, your economic advisor said
yesterday you would also support bringing more of the benefits forward
to the first year of the plan. Is that correct?

THE PRESIDENT: What I'm referring
to is enhancing the cash flow of the taxpayer as quickly as possible,
and that's what we're going to work on. I also saw some
comments which I thought made a lot of sense, that some in Congress
view this as an opportunity to load up the tax relief plan with their
own vision of tax relief. I want the members of Congress and
the American people to hear loud and clear: this is the
right size plan, it is the right approach and I'm going to defend it
mightily.

Q There is no family,
sir, representing the last tax bracket, the bracket that would get the
highest dollar return. Why is that?

THE PRESIDENT: Well, I beg your
pardon, I'm representing -- (laughter) -- I got a little pay raise
coming to Washington from Austin; I'll be in the top
bracket. (Laughter.)

Q Mr. President, on
another note, sir? It appears the Clintons may have taken
some gifts that were actually given to the White House. Do
yo feel that they should return any of these gifts?

THE PRESIDENT: It's important for
all the facts to be laid out on the table and I'm confident that the
President -- the former President and First Lady will make the right
decision.